Leader of Southwark Council calls on Government to “allow councils to become homebuilders again”

12 December 2016

Leader of Southwark Council Cllr Peter John called on government to enable local authorities to build more affordable homes, in an evidence session at the Communities and Local Government Committee.

Cllr John attended the Committee as part of a panel of local government representatives, to give evidence for the Committee’s inquiry into capacity in the homebuilding industry.

Cllr John highlighted the work Southwark has done to deliver affordable homes in the borough, with more new affordable homes being built in Southwark in recent years than most boroughs in the country. Southwark Council is also embarking on a record council-home building programme to deliver 11,000 new council homes over 30 years. However this has been achieved in a very difficult climate, as local authorities no longer have the funding or the capacity to deliver the record numbers of new homes that were being built in previous decades.

Cllr John pointed to the figures that show local authorities were major homebuilders in the UK right up until the late 1970s, building around 100,000 homes a year, after which council homebuilding fell. The number of new homes being built in the UK has dropped from more than 300,000 a year in the decades after the Second World War, to about half of that today. Cllr John argues that these figures demonstrate that private developers and housing associations have been unable to fill the gap in homebuilding that was previously being delivered by local authorities.

Cllr John spoke at the Committee about the significant barriers facing local authorities in homebuilding, including restrictions on funding sources and political uncertainty due to changes in Government housing policy. The housing problem is particularly stark in London and the South East, where the gap between the needs of the population and housing available continues to grow; a problem which is being accentuated by the sale of affordable homes through Right to Buy.

Leader of Southwark Council Peter John said: “National changes to the funding of homebuilding mean that local authorities face significant financial challenges and rely increasingly on private sector partnerships to deliver new homes. In Southwark we have successfully used these partnerships to deliver new affordable homes, but local authorities face a real challenge in ensuring developers build the right kind of housing to meet local need. Changes to national housing legislation and uncertainty over Government policies are making this even more difficult.”

“Local authorities have a key role to play in meeting local housing need. In the 1950s, 60s and 70s councils were building hundreds of thousands of new homes. After 1979 homebuilding by local authorities fell and the private sector and housing associations have never been able to fill that gap, which has led to the current housing shortage. It’s time for the Government to allow councils to become homebuilders again.”